<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [_]
Filed by a Party other than the Registrant [X]
Check the appropriate box:
[_] Preliminary Proxy Statement [_] CONFIDENTIAL, FOR USE OF THE
COMMISSION ONLY (AS PERMITTED BY
RULE 14A-6(E)(2))
[X] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
Market Facts, Inc.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[_] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), 14a-6(i)(2)
or Item 22(a)(2) of Schedule 14A.
[_] $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
-------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
-------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which
the filing fee is calculated and state how it was determined):
-------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
-------------------------------------------------------------------------
(5) Total fee paid:
-------------------------------------------------------------------------
[X] Fee paid previously with preliminary materials.
[_] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
-------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
-------------------------------------------------------------------------
(3) Filing Party:
-------------------------------------------------------------------------
(4) Date Filed:
-------------------------------------------------------------------------
Notes:
<PAGE>
MARKET FACTS, INC.
3040 West Salt Creek Lane
Arlington Heights, Illinois 60005
-----------------------------------------
NOTICE OF
ANNUAL MEETING
AND
PROXY STATEMENT
-----------------------------------------
ANNUAL MEETING OF STOCKHOLDERS
APRIL 24, 1996
<PAGE>
MARKET FACTS, INC.
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD APRIL 24, 1996
To the Stockholders of Market Facts:
Notice is hereby given that the Annual Meeting of Stockholders of Market
Facts, Inc., a Delaware corporation, will be held at the Arlington Park Hilton
Hotel, Euclid Avenue & Rohlwing Road in Arlington Heights, IL on Wednesday,
April 24, 1996 at 10:30 AM for the following purposes:
(1) To elect four (4) directors to serve for a term of three (3) years each as
specified in the proxy statement or until their successors are elected and
qualify.
(2) To transact such other business as may properly come before the meeting.
The Annual Report of the Company for the fiscal year ended December 31, 1995
accompanies this Notice.
By Order of the Board of Directors,
WESLEY S. WALTON
Secretary
Arlington Heights, Illinois
March 21, 1996
- --------------------------------------------------------------------------------
IMPORTANT
A proxy statement and proxy are submitted herewith. ALL STOCKHOLDERS ARE URGED
TO COMPLETE AND MAIL THE PROXY PROMPTLY. The enclosed envelope for return of
proxy requires no postage if mailed in the U.S.A. Stockholders attending the
meeting may personally vote on all matters which are considered, in which
event the signed proxy is revoked. It is important that your stock be voted.
- --------------------------------------------------------------------------------
<PAGE>
MARKET FACTS, INC.
PROXY STATEMENT
3040 West Salt Creek Lane
Arlington Heights, Illinois 60005
(847) 590-7000
This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors of Market Facts, Inc. (the "Company") for use
at the Annual Meeting of Stockholders of the Company to be held on April 24,
1996. A stockholder may revoke a proxy at any time prior to the exercise of the
powers therein granted. This may be done prior to the meeting by written
revocation sent to the Secretary of the Company at the principal office of the
Company, 3040 West Salt Creek Lane, Arlington Heights, Illinois 60005; or it may
be done personally upon oral or written request at the Annual Meeting. All
expenses in connection with the solicitation of proxies will be borne by the
Company. In addition to the use of the mail, proxies may be solicited
personally, by telephone, facsimile or by telegraph. This Proxy Statement and
proxy are being mailed on or about March 21, 1996 to all stockholders of record
on March 1, 1996.
VOTING SECURITIES
The Board of Directors has fixed the close of business on March 1, 1996 as the
record date for the determination of the stockholders entitled to vote at the
meeting and any adjournment thereof, notwithstanding any subsequent transfers of
stock. The stock transfer books of the Company will not be closed.
On March 1, 1996, there were outstanding 1,926,769 shares of Common Stock of
the Company, each of which shares is entitled to one vote.
The following table sets forth all persons known by the Board of Directors to
be beneficial owners of more than five percent of the Company's Common Stock
outstanding as of March 1, 1996:
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------
NAME AND ADDRESS NUMBER OF SHARES AND PERCENT
OF BENEFICIAL OWNER NATURE OF BENEFICIAL OWNERSHIP/(1)/ OF CLASS
- -----------------------------------------------------------------------------------
<S> <C> <C>
Bankmont Financial Corp.
111 West Monroe St. 248,897/(2)/ 12.92%
P.O. Box 755
Chicago, Illinois 60690
- -----------------------------------------------------------------------------------
Verne B. Churchill
Market Facts, Inc. 153,471/(3)/ 7.94%
3040 West Salt Creek Lane
Arlington Heights, Illinois 60005
- -----------------------------------------------------------------------------------
Gregory J. Spagna
Suite 1600 140,000/(4)/ 7.27%
25 West 45th Street
New York, New York 10036
- -----------------------------------------------------------------------------------
Sanford M. Schwartz
Market Facts--New York, Inc. 102,302/(5)/ 5.31%
902 Broadway
New York, New York 10010
- -----------------------------------------------------------------------------------
</TABLE>
2
<PAGE>
- ------------
(1) The nature of beneficial ownership of securities is direct, and arises from
sole voting and investment power, unless otherwise indicated by footnote.
(2) As reported in Schedule 13G dated February 14, 1996, filed by Bankmont
Financial Corp., a wholly-owned subsidiary of Bank of Montreal. Bankmont
Financial Corp., its wholly-owned subsidiary Harris Bankcorp, Inc., and its
wholly-owned subsidiary Harris Trust and Savings Bank, expressly disclaim
beneficial ownership of the 248,897 shares of Company Common Stock held by
the Harris Trust and Savings Bank as Trustee of the Market Facts, Inc.
Profit Sharing and Retirement Plan ("Profit Sharing Plan") and the Market
Facts Employee Stock Ownership Plan ("ESOP").
(3) Includes 6,000 shares subject to immediately exercisable stock options,
2,849 shares allocated to Mr. Churchill under the ESOP and 46,925 shares
held for the benefit of Mr. Churchill in the Market Facts Stock Fund of the
Company's Profit Sharing Plan.
(4) As reported in Mr. Spagna's Schedule 13G dated January 3, 1996.
(5) Includes 100,000 shares which are subject to the terms of a Restricted Stock
Award and vest 10% each year commencing January 5, 1993. As of March 1,
1996, 40,000 of such shares had vested. Upon the termination of Dr.
Schwartz's employment with the Company, any unvested shares will be
forfeited and returned to the Company. A total of 490 shares are allocated
to Dr. Schwartz under the ESOP and 1,812 shares are held for the benefit of
Dr. Schwartz in the Market Facts Stock Fund of the Company's Profit Sharing
Plan.
Information regarding shares of Common Stock of the Company beneficially owned
by all directors and nominees, by all present directors and executive officers
as a group, and by each Named Executive is included under "Information
Respecting Nominees," "Continuing Directors" and "Security Ownership of Named
Executive" on pages 4, 5 and 6 of this Proxy Statement.
ITEM 1. ELECTION OF DIRECTORS
At the Annual Meeting four (4) directors of the Company will be elected. The
Company's Restated Certificate of Incorporation divides the Board of Directors,
which presently consists of eleven directors, into three classes, each having a
term of three years. Four directors, Messrs. Lawrence W. Labash, Thomas H.
Payne, Sanford M. Schwartz and Wesley S. Walton, have been nominated by the
Board of Directors to serve for a term of three years each. It is intended that
the enclosed proxy shall be voted for the election of these four (4) nominees
unless authority to do so is withheld. In the event any of said nominees shall
cease to be a candidate for election for any reason, the proxy will be voted for
a substitute nominee designated by the Board of Directors and for the remaining
nominees so listed. The Board of Directors currently has no reason to believe
that any nominee will be either unwilling or unable to serve as a director if
elected. Any proxies given by stockholders cannot be voted for a greater number
of persons than the number of nominees listed and identified.
3
<PAGE>
INFORMATION RESPECTING NOMINEES
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------------------
NAME AGE PRINCIPAL OCCUPATION DATE FIRST NUMBER OF % OF
OR EMPLOYMENT FOR ELECTED DIRECTOR COMMON SHARES CLASS
LAST FIVE YEARS BENEFICIALLY OWNED
OWNED 3/1/96/(1)/
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Lawrence W. Labash 48 Senior Vice President of January 24, 1994 24,508/(2)/ 1.27%
the Company.
- -------------------------------------------------------------------------------------------------------------------------------
Thomas H. Payne 50 President and Chief December 7, 1982 50,338/(3)/ 2.59%
Operating Officer of the
Company.
- -------------------------------------------------------------------------------------------------------------------------------
Sanford M. Schwartz 44 Executive Vice President of October 28, 1992 102,302/(4)/ 5.31%
the Company and President
of Market Facts--New York,
Inc. since July, 1992;
prior thereto, President of
Elrick & Lavidge, a market
research firm in New York,
New York.
- -------------------------------------------------------------------------------------------------------------------------------
Wesley S. Walton 57 Secretary of the Company; April 27, 1988 24,000/(6)/ 1.25%
and Chairman of the
Management Committee for
the law firm of Keck, Mahin
& Cate, Chicago,
Illinois./(5)/
- -------------------------------------------------------------------------------------------------------------------------------
</TABLE>
- ------------
(1) The nature of beneficial ownership of securities is direct, and arises from
sole voting and investment power, unless otherwise indicated by footnote.
(2) Includes 5,000 shares subject to immediately exercisable stock options,
3,300 shares with respect to which voting and investment powers are shared,
1,391 shares allocated to Mr. Labash under the ESOP and 8,223 shares held
for his benefit in the Market Facts Stock Fund of the Company's Profit
Sharing Plan.
(3) Includes 15,000 shares subject to immediately exercisable stock options,
2,520 shares allocated to Mr. Payne under the ESOP and 6,161 shares held for
his benefit in the Market Facts Stock Fund of the Company's Profit Sharing
Plan.
(4) Includes 100,000 shares which are subject to the terms of a Restricted Stock
Award and vest 10% each year commencing January 5, 1993. As of March 1,
1996, 40,000 of such shares had vested. Upon the termination of Dr.
Schwartz's employment with the Company, any unvested shares will be
forfeited and returned to the Company. A total of 490 shares are allocated
to Dr. Schwartz under the ESOP and 1,812 shares are held for the benefit of
Dr. Schwartz in the Market Facts Stock Fund of the Company's Profit Sharing
Plan.
(5) Keck, Mahin & Cate serves as general counsel to the Company and is expected
to continue in that capacity for the current year.
(6) Includes 2,000 shares held by the Wesley S. and Jurdis Walton Charitable
Foundation, as to which voting and investment powers are shared.
4
<PAGE>
CONTINUING DIRECTORS WHOSE TERMS OF OFFICE EXPIRE IN 1998
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------------------
NAME AGE PRINCIPAL OCCUPATION DATE FIRST NUMBER OF % OF
OR EMPLOYMENT FOR ELECTED DIRECTOR COMMON SHARES CLASS
LAST FIVE YEARS BENEFICIALLY OWNED
OWNED 3/1/96/(1)/
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
William W. Boyd 69 Chairman of the Board of January 24, 1994 None 0%
Sterling Plumbing Group,
Inc., Rolling Meadows,
Illinois since 1992;
prior thereto, Chairman,
President and Chief
Executive Officer./(2)/
- -------------------------------------------------------------------------------------------------------------------------------
John C. Robertson 64 Chairman, Market Facts of March 26, 1964 20,616 1.07%
Canada, Ltd./(3)/
- -------------------------------------------------------------------------------------------------------------------------------
Timothy Q. Rounds 57 Senior Vice President of September 12, 1984 34,637/(4)/ 1.79%
the Company.
- -------------------------------------------------------------------------------------------------------------------------------
Glenn W. Schmidt 53 Executive Vice President July 23, 1980 54,566/(5)/ 2.82%
of the Company.
- -------------------------------------------------------------------------------------------------------------------------------
</TABLE>
- ------------
(1) The nature of beneficial ownership of securities is direct, and arises from
sole voting and investment power, unless otherwise indicated by footnote.
(2) Mr. Boyd is a trustee of the SteinRoe Income Trust, the SteinRoe Investment
Trust and the SteinRoe Municipal Trust. He also is Chairman of the Board of
Trustees of Elmhurst College, as well as a director of Cummins-Allison Corp.
and Kohler Company.
(3) Until April 30, 1994, Mr. Robertson and his wife jointly owned the Canadian
company which held 50% of the outstanding shares of Common Stock of Market
Facts of Canada, Ltd. The Company acquired their interest in the Canadian
company on April 30, 1994 and now has full ownership of Market Facts of
Canada, Ltd.
(4) Includes 5,000 shares subject to immediately exercisable stock options and
1,492 shares allocated to Mr. Rounds under the ESOP.
(5) Includes 6,000 shares subject to immediately exercisable stock options,
7,800 shares held by Mr. Schmidt as custodian for his daughter, 2,345 shares
allocated to him under the ESOP and 5,030 shares held for his benefit in the
Market Facts Stock Fund of the Company's Profit Sharing Plan.
5
<PAGE>
CONTINUING DIRECTORS WHOSE TERMS OF OFFICE EXPIRE IN 1997
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------------------
NAME AGE PRINCIPAL OCCUPATION DATE FIRST NUMBER OF % OF
OR EMPLOYMENT FOR ELECTED DIRECTOR COMMON SHARES CLASS
LAST FIVE YEARS BENEFICIALLY OWNED
OWNED 3/1/96/(1)/
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Verne B. Churchill 63 Chairman and Chief Executive March 13, 1967 153,471/(2)/ 7.94%
Officer of the Company.
- -------------------------------------------------------------------------------------------------------------------------------
Karen E. Predow-James 47 Division Manager, Consumer February 3, 1993 None 0%
Communications Services for
AT&T, Basking Ridge, New
Jersey since October, 1994;
prior thereto, Vice
President of The Chase
Manhattan Bank, N.A., New
York, New York.
- -------------------------------------------------------------------------------------------------------------------------------
Jack R. Wentworth 67 Professor and former Dean, April 27, 1988 200 0.01%
Graduate School of Business,
Indiana University,
Bloomington, Indiana./(3)/
- -------------------------------------------------------------------------------------------------------------------------------
ALL 21 PRESENT DIRECTORS AND EXECUTIVE OFFICERS AS A GROUP 645,238/(4)/ 32.33%
- -------------------------------------------------------------------------------------------------------------------------------
</TABLE>
- ------------
(1) The nature of beneficial ownership of securities is direct, and arises from
sole voting and investment power, unless otherwise indicated by footnote.
(2) Includes 6,000 shares subject to immediately exercisable stock options,
2,849 shares allocated to Mr. Churchill under the ESOP and 46,925 shares
held for the benefit of Mr. Churchill in the Market Facts Stock Fund of the
Company's Profit Sharing Plan.
(3) Dr. Wentworth is also a director of Kimball International, Inc. and Lone
Star Industries, Inc.
(4) Includes 18,600 shares with respect to which voting and investment powers
are shared, 69,000 shares subject to immediately exercisable stock options,
21,994 shares allocated to executive officers under the ESOP and 92,289
shares held for the benefit of executive officers of the Company in the
Market Facts Stock Fund of the Company's Profit Sharing Plan.
SECURITY OWNERSHIP OF NAMED EXECUTIVE/(1)/
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------
APPROXIMATE NUMBER OF COMMON SHARES
NAME BENEFICIALLY OWNED 3/1/96 % OF CLASS OWNED
- ------------------------------------------------------------------------------------------------------
<S> <C> <C>
Stephen J. Weber 23,350/(1)/ 1.21%
- ------------------------------------------------------------------------------------------------------
</TABLE>
- ------------
(1) This table describes the beneficial ownership of shares held by the sole
non-director Named Executive. Such shares include 13,630 shares held
directly, 3,000 shares with respect to which voting and investment powers
are shared, 5,000 shares subject to immediately exercisable options, and
1,720 shares allocated to Mr. Weber under the ESOP.
6
<PAGE>
REMUNERATION OF NAMED EXECUTIVE OFFICERS
The Summary Compensation Table which follows includes, for each of the fiscal
years ended December 31, 1995, 1994, 1993, 1992 and 1991, individual
compensation for services to the Company and its subsidiaries paid to: (i) the
Chief Executive Officer and (ii) the four other most highly paid executive
officers of the Company for 1995 (together the "Named Executives").
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------
ANNUAL COMPENSATION LONG-TERM
COMPENSATION COMPENSATION/(2)/
AWARDS
- ---------------------------------------------------------------------------------------------------------------------------------
SECURITIES
NAME AND YEAR SALARY BONUS OTHER ANNUAL RESTRICTED UNDERLYING
PRINCIPAL POSITION COMPENSATION/(1)/ STOCK OPTIONS
AWARD (SHARES)
- ---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Verne B. Churchill 1995 $206,100 $105,000 $ 6,568 0 0 $5,207
1994 $196,300 $ 87,000 $ 6,085 0 0 $3,380
Chairman and 1993 $188,656 $ 80,000 $ 4,557 0 0 $6,399
Chief Executive Officer 1992 $188,656 $ 34,000 $ 4,897 0 6,000 $ 0
1991 $188,656 $ 42,782 $ 5,977 0 4,000 $7,021
- ---------------------------------------------------------------------------------------------------------------------------------
Thomas H. Payne 1995 $181,620 $105,000 $12,406 0 0 $5,207
1994 $172,964 $ 87,000 $11,863 0 0 $3,380
President and 1993 $166,244 $ 80,000 $ 6,825 0 0 $5,859
Chief Operating Officer 1992 $166,244 $ 34,000 $ 4,617 0 15,000 $ 0
1991 $166,244 $ 35,084 $ 4,849 0 4,000 $6,757
- ---------------------------------------------------------------------------------------------------------------------------------
Glenn W. Schmidt 1995 $171,882 $ 75,000 $10,713 0 0 $5,207
1994 $163,684 $ 62,000 $12,594 0 0 $3,380
Executive Vice President 1993 $157,300 $ 56,000 $ 5,576 0 0 $5,478
1992 $157,300 $ 30,000 $ 5,257 0 6,000 $ 0
1991 $156,680 $ 31,000 $ 6,668 0 4,000 $6,345
- ---------------------------------------------------------------------------------------------------------------------------------
Sanford M. Schwartz 1995 $191,254 $ 20,000 $ 9,600 0 0 $5,207
1994 $182,130 $ 15,000 $10,831 0 0 $3,380
Executive Vice President 1993 $175,032 $ 10,000 $ 1,227 0 0 $5,031
and President of 1992 $ 84,150 $ 0 $ 0 $475,000/(3)/ 0 $ 0
Market Facts--New York, Inc.
- ---------------------------------------------------------------------------------------------------------------------------------
Stephen J. Weber 1995 $143,262 $ 45,000 $10,564 0 0 $5,207
1994 $135,968 $ 40,000 $ 9,944 0 0 $3,380
Senior Vice President 1993 $129,602 $ 35,000 $ 4,735 0 0 $4,604
1992 $123,412 $ 26,000 $ 5,296 0 5,000 $ 0
1991 $117,535 $ 25,500 $ 4,856 0 3,500 $4,543
- ---------------------------------------------------------------------------------------------------------------------------------
</TABLE>
7
<PAGE>
- ------------
(1) These amounts represent, for each of the Named Executives, transportation
allowance payments or the value of his personal use of a Company car which
is reported to the Internal Revenue Service as income, and quarterly
reimbursements of interest paid on loans given to purchase Company stock.
The total amount of perquisites and other personal benefits did not exceed
the lesser of $50,000 or 10% of total annual salary and bonus for any of
the Named Executives for any year shown.
(2) These amounts represent, for each of the Named Executives, amounts
contributed for their accounts pursuant to the Market Facts Profit Sharing
Plan and the ESOP. Pursuant to the Profit Sharing Plan, the amounts
credited to the Named Executives in 1995, 1994, 1993, 1992 and 1991,
respectively, were as follows: Mr. Churchill, $4,797, $3,380, $3,049, $0,
and $3,464; Mr. Payne, $4,797, $3,380, $2,779, $0, and $3,365; Mr.
Schmidt, $4,797, $3,380, $2,589, $0, and $3,162; and Mr. Weber, $4,797,
$3,380, $2,152, $0, and $2,269. Dr. Schwartz was credited with $4,797 in
1995, $3,380 in 1994 and $2,365 in 1993.
The Company made cash contributions to the ESOP in 1991 and 1995; shares
of Company stock were contributed in 1993 and the Company did not make a
contribution to the ESOP in 1992 and 1994. The equivalent shares that were
contributed to the Named Executives in 1995, 1994, 1993, 1992 and 1991,
respectively, were as follows: Mr. Churchill, 32 shares, 0 shares, 508
shares, 0 shares and 837 shares; Mr. Payne, 32 shares, 0 shares, 463
shares, 0 shares and 798 shares; Mr. Schmidt, 32 shares, 0 shares, 431
shares, 0 shares and 749 shares; and Mr. Weber, 32 shares, 0 shares, 358
shares, 0 shares and 535 shares. Dr. Schwartz received 32 shares in 1995,
0 shares in 1994 and 394 shares in 1993. Based on the closing price per
share as of December 31 of each such year ($12.50, $8.00, $6.25, $3.75 and
$4.25, respectively), the value of the contributions to each Named
Executive was as follows: Mr. Churchill, $410, $0, $3,175, $0 and $3,557;
Mr. Payne, $410, $0, $2,894, $0 and $3,392; Mr. Schmidt, $410, $0, $2,694,
$0 and $3,183; and Mr. Weber, $410, $0, $2,238, $0 and $2,274. Dr.
Schwartz received $410 in 1995, no contribution in 1994 and the value of
his 1993 contribution was $2,463.
(3) On July 6, 1992, in connection with the commencement of his employment
with the Company, Dr. Schwartz was awarded 100,000 shares of Common Stock,
subject to a ten-year vesting schedule. The amount shown is the value of
such shares based on the closing price at the time of the award. The
shares vest at the rate of 10,000 shares per year, commencing January 5,
1993 and ending January 5, 2002. Prior to vesting, the shares are subject
to restrictions on transfer and forfeiture, if Dr. Schwartz's employment
with the Company should terminate. As of December 31, 1995, Dr. Schwartz
held 70,000 restricted shares with an aggregate value of $875,000, based
on the closing price of the shares on December 31, 1995. Dr. Schwartz is
entitled to receive dividends on the shares, whether or not they have
vested. As of December 31, 1995, no shares of restricted stock were held
by any of the other Named Executives.
STOCK OPTIONS
Shown below is information with respect to the unexercised options to purchase
the Company's Common Stock at fiscal year-end 1995 granted under the 1982
Incentive Stock Option Plan (the "1982 Plan") to the Named Executives. There
were no options granted to the Named Executives during 1995 since the 1982 Plan
expired as of May 1, 1992.
Options granted pursuant to the 1982 Plan are not transferable except by will
or under the laws of descent and distribution, and stock acquired through the
exercise of an option may not be sold or otherwise transferred, except by will
or pursuant to the laws of descent and distribution, for two years from the
exercise date. All shares received upon the exercise of an option granted
pursuant to the 1982 Plan bear an appropriate restrictive legend.
8
<PAGE>
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR END OPTION VALUES
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------
NAME SHARES VALUE NUMBER OF SECURITIES VALUE OF UNEXERCISED
ACQUIRED ON REALIZED ($) UNDERLYING UNEXERCISED IN-THE-MONEY OPTIONS
EXERCISE OPTIONS AT 12/31/95 AT 12/31/95
EXERCISABLE/UNEXERCISABLE EXERCISABLE/UNEXERCISABLE
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Churchill 4,000 $12,500 6,000/0 $ 75,000/$0
- ---------------------------------------------------------------------------------------------------------------------
Payne 4,000 $12,500 15,000/0 $187,500/$0
- ---------------------------------------------------------------------------------------------------------------------
Schmidt 4,000 $12,500 6,000/0 $ 75,000/$0
- ---------------------------------------------------------------------------------------------------------------------
Schwartz 0 0 0/0 $ 0/$0
- ---------------------------------------------------------------------------------------------------------------------
Weber 3,500 $10,937 5,000/0 $ 62,500/$0
- ---------------------------------------------------------------------------------------------------------------------
</TABLE>
EMPLOYMENT AGREEMENTS
In October 1994, Messrs. Churchill, Schmidt and Schwartz entered into
Employment Agreements (collectively the "Agreements") with the Company. Each
Agreement has a three-year term of employment which commenced on October 25,
1994, the date the Board of Directors ratified and approved the Agreements. The
Agreements provide for a base annual salary for Messrs. Churchill, Schmidt and
Schwartz of $198,120, $165,204 and $183,820, respectively. These salaries may be
adjusted to conform to alterations in the Company's compensation policy for
officers. The Agreements also provide for reimbursement of expenses, the right
to participate in the Company's benefit programs and eligibility for an annual
bonus consistent with the provisions and goals set by the Board of Directors for
each bonus year.
In addition, each Agreement terminates upon the officer's death and may be
terminated by the Company for cause, or upon the officer's disability, or by
mutual agreement. If the Agreement is terminated due to the officer's death or
if his death occurs prior to receipt of all payments under the Agreement, all
such payment(s) shall be made to the officer's designated beneficiary or estate.
The Agreements contain confidentiality and noncompete restrictions during the
term of employment and for a period of one year thereafter. The Agreements also
require the employee to reimburse the Company for any benefits provided under
the Agreement which are disallowed as deductible expenses by the Internal
Revenue Service on the grounds that they do not constitute a reasonable
allowance or are deemed to be a waste of corporate assets by a court of
competent jurisdiction.
CERTAIN TRANSACTIONS
The Company provides loans to certain of its executive officers in the form of
promissory notes and demand notes for the principle purpose of exercising stock
options and purchasing stock of the Company. These loans bear interest at the
prime rate quoted on a quarterly basis by Harris Trust and Savings Bank,
Chicago, Illinois. The largest aggregate amount of the above indebtedness
outstanding for any executive officer which exceeded $60,000 from January 1,
1995 to the date of this Proxy Statement was $79,562 for Mr. Timothy J.
Sullivan, Vice President, Treasurer and Assistant Secretary of the Company. The
outstanding principal balance on Mr. Sullivan's loan as of the date of this
Proxy Statement was $71,462.
COMPENSATION COMMITTEE INTERLOCKS
AND INSIDER PARTICIPATION
At the Compensation Committee's request, Mr. Payne conferred with the
Committee to make recommendations for 1995 bonuses for Messrs. Schmidt, Schwartz
and Weber.
9
<PAGE>
BOARD COMPENSATION COMMITTEE REPORT
ON EXECUTIVE COMPENSATION
The Compensation Committee, throughout 1995 and subsequently, has been
composed of Jack R. Wentworth, Chairman, Karen Predow-James and Wesley S.
Walton.
In April 1995, the Committee reviewed the salaries of the Named Executives and
approved a five percent (5%) increase commencing March 1, 1995, for Messrs.
Verne B. Churchill, Thomas H. Payne, Glenn W. Schmidt, Sanford M. Schwartz and
Stephen J. Weber. These increases were in line with those made for client
service unit managers and were considered appropriate in light of the progress
of the Company.
In January 1996, at the Committee's request, Mr. Payne, President, conferred
with the Committee to make recommendations for 1995 bonuses for Messrs. Schmidt,
Schwartz and Weber. Thereafter, the Committee independently determined these
1995 bonuses as set forth in the Summary Compensation Table. Mr. Weber's bonus
was based in large part on the Company's bonus policy applicable to all Client
Service Unit Managers, such as Mr. Weber. Under this policy, each Client Service
Unit receives a bonus pool equal to a percentage of gross revenue and an
additional payment equal to a percentage of net margin (net margin being defined
as gross margin less unallocated overhead salaries plus late job costs). The
bonus paid from the pool for each unit manager under this policy, is based upon
the discretion of senior management, subject in the case of Mr. Weber to the
judgment of the Committee.
When Dr. Schwartz joined the Company in July 1992, the common stock incentive
award described in note (3) to the Summary Compensation Table above was
negotiated. There was no agreed bonus or formula for a bonus in light of the
incentive nature of the common stock award. Nonetheless, in the judgment of
management and the Committee, because of the financial and operational results
achieved within the managerial assignments of Dr. Schwartz, bonuses for Dr.
Schwartz were deemed appropriate in 1993 and 1994, and in the judgment of
management and the Committee, a $20,000 bonus for 1995 was deemed appropriate.
The 1995 bonuses for Messrs. Churchill, Payne and Schmidt were in large part
based on the continued improved financial results of the Company in 1995. It was
the view of the Committee that each of these individuals made a material
contribution to the Company's financial and operational growth during 1995. Mr.
Schmidt's 1995 bonus was also a reflection of his continued success in
containing expenses and managing large-scale projects.
Effective January 1, 1994, the allowable deduction for federal income tax
purposes of compensation paid by the Company to the Named Executives is
$1,000,000 per executive per year. This limitation does not apply to
compensation that is based upon the attainment of performance goals or paid
pursuant to a written contract that was in effect on February 17, 1993. These
limitations have not affected the Company's ability to deduct all taxable
compensation paid to its Named Executives and is not expected to affect these
deductions in the foreseeable future.
Except as otherwise described above, the Committee's determinations regarding
1995 compensation were not subject to specific criteria but were based upon more
general criteria as the Committee in its discretion considered to be relevant,
including the Committee's perception of the individual's performance and the
overall financial and earnings performance of the Company.
Karen Predow-James
Wesley S. Walton
Jack R. Wentworth, Chairman
10
<PAGE>
TOTAL RETURN COMPARISON
The following graph sets forth a five-year comparison of cumulative total
returns for: (i) the Company (which is traded on the Nasdaq/NMS); (ii) the
Center for Research in Securities Prices ("CRSP") Index for Nasdaq Stock Market
(U.S. Companies); and (iii) a Peer Group of companies listed on Nasdaq in 1995
that performs market research services (the "Peer Group"). In identifying the
Peer Group, the Company reviewed a list of Nasdaq companies designated under the
Standard Industrial Classification Code ("SIC Code") for "Business Consulting
Service Companies" as well as companies listed under the SIC Codes for the
subcategory "Commercial, Economic, Sociological, and Educational Research"
included under the category entitled "Research, Development, and Testing
Services" and the subcategory "Information Retrieval Services" included under
the category "Computer Programming, Data Processing, and Other Computer Related
Services." From the companies listed within one of these three SIC Codes, the
Company selected those with business descriptions similar to that of the
Company's for inclusion in the Peer Group. The Peer Group includes the following
companies: American Business Information, Inc.; Find SVP, Inc.; M/A/R/C Group,
Inc.; Market Facts, Inc.; NFO Research, Inc.; Opinion Research Corp.; and Total
Research Corporation. All returns were calculated assuming dividend reinvestment
and the returns of each company have been weighted according to market
capitalization at the beginning of each period indicated.
COMPARISON OF FIVE YEAR--CUMULATIVE TOTAL RETURNS
Performance Graph for Market Facts, Inc.
[PERFORMANCE GRAPH APPEARS HERE]
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------
SYMBOL CRSP TOTAL RETURNS INDEX: 12/31/90 12/31/91 12/31/92 12/31/93 12/30/94 12/29/95
<S> <C> <C> <C> <C> <C> <C>
- -----------------------------------------------------------------------------------------------
- ------ MARKET FACTS, INC............100.0......71.3......71.7.....134.8.....165.4.....267.8
- -- - -- NASDAQ STOCK MARKET..........100.0.....160.6.....186.9.....214.5.....209.7.....296.3
(U.S. Companies)
- - - - Peer Group...................100.0.....139.2.....200.7.....173.7.....208.5.....326.0
- -----------------------------------------------------------------------------------------------
Notes:
A. The lines represent annual index levels derived from compounded daily returns that
include all dividends.
B. The indexes are reweighted daily, using the market capitalization on the previous
trading day.
C. If the annual interval, based on the fiscal year-end, is not a trading day, the
preceding trading day is used.
D. The index level for all series was set to 100.0 on 12/31/90.
- -----------------------------------------------------------------------------------------------
</TABLE>
11
<PAGE>
VOTE REQUIRED
Presence in person or by proxy of holders of a majority of the
outstanding shares of Common Stock will constitute a quorum at the Annual
Meeting. Assuming a quorum is present, the affirmative vote by the holders of a
plurality of the shares represented and entitled to vote will be required to act
on the election of directors, and the affirmative vote by the holders of a
majority of the shares represented and entitled to vote will be required to act
on all other matters to come before the Annual Meeting. A broker non-vote is not
counted in determining voting results. If a shareholder, present in person or by
proxy, abstains on any matter, the shareholder's shares will not be voted on
such matter. Thus, an abstention from voting on a matter has the same legal
effect as a vote "AGAINST" the matter.
RELATIONSHIP WITH INDEPENDENT PUBLIC ACCOUNTANTS
Since December of 1990, the Company has engaged the firm of KPMG Peat Marwick
LLP as its independent public accountants. A representative from this firm will
be present at the Annual Meeting of Stockholders, and will be available to
respond to appropriate questions from the stockholders if the need arises, or
make a statement if the representative desires to do so. It is anticipated that
this firm will be engaged as the Company's independent public accountants in
1996.
BOARD OF DIRECTORS AND COMMITTEE DATA
During 1995, five Board meetings were held. All directors of the Company
attended all of the Board meetings held during the year with the exceptions of
Messrs. Boyd and Rounds, who attended four of the meetings.
The Board of Directors does not have a standing nominating committee. Its
Audit Committee, which held two meetings during 1995, consisted of Mr. Boyd as
Chairman, Dr. Wentworth and Mr. Schmidt. All three members of this committee
attended both meetings. The duties of the Audit Committee are to advise the
Company on its engagement of independent public accountants, and to review all
reports of the Company's audit performed by its independent public accountants.
In 1995 its Compensation Committee consisted of Dr. Wentworth as Chairman, Mr.
Walton and Dr. Predow-James. The functions performed by the Compensation
Committee are to establish the compensation and benefits for each of the Named
Executives. The Compensation Committee held two in 1995 meetings, and all three
members of this committee attended both meetings.
Throughout 1995, the Company maintained an arrangement whereby directors who
are not officers and employees of the Company each received an attendance fee of
$3,000 for each director's meeting at which they were present. Such directors
who are members of the Audit or Compensation Committee received an additional
$1,500 for each meeting of the Audit and/or Compensation Committees at which
they were present. Directors who are also officers and employees of the Company
are not paid for their services as directors as such, nor for the attendance at
board or committee meetings. No director received more than the standard
arrangement for services as a director during the last fiscal year.
STOCKHOLDER PROPOSALS
Stockholder proposals intended to be included in the Company's proxy statement
and form of proxy relating to, and to be presented at, the Annual Meeting of
Stockholders of the Company to be held in 1997, must be received by the Company
on or before December 1, 1996.
12
<PAGE>
OTHER MATTERS
The Board of Directors is not aware of any matters that will come before the
meeting other than the matters described herein. However, if other matters do
properly come before the meeting, it is the intention of the persons named in
the proxy to vote the proxy in accordance with their best judgment.
Stockholders who do not expect to attend the meeting in person are urged to
indicate their choices and sign, date and return the enclosed proxy as soon as
possible.
By Order of the Board of Directors,
Verne B. Churchill Thomas H. Payne
Chairman, Board of Directors President and
and Chief Executive Officer Chief Operating Officer
Arlington Heights, Illinois
March 21, 1996
- -------------------------------------------------------------------------------
MARKET FACTS WILL BE PLEASED TO MAKE ITS ANNUAL REPORT ON FORM 10-K TO THE
SECURITIES AND EXCHANGE COMMISSION AVAILABLE TO STOCKHOLDERS WITHOUT CHARGE,
UPON REQUEST IN WRITING TO THE CORPORATE ASSISTANT SECRETARY.
- -------------------------------------------------------------------------------
13
<PAGE>
MARKET FACTS, INC.
PROXY SOLICITED BY THE BOARD OF DIRECTORS FOR THE ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD APRIL 24, 1996
The undersigned hereby constitutes and appoints VERNE B. CHURCHILL, THOMAS H.
PAYNE, and WESLEY S. WALTON, or any one or more of them, Proxies, with full
power of substitution, to vote for the undersigned the shares of Common Stock of
MARKET FACTS, INC., registered in the name of the undersigned at the Annual
Meeting of Stockholders of said corporation to held on April 24, 1996, and at
any and all adjournments thereof, upon the following matters more fully
described in the Proxy Statement:
(1) FOR ( ) VOTE WITHHELD FROM ( ) the election as Directors of
LAWRENCE W. LABASH, THOMAS H. PAYNE, SANFORD M. SCHWARTZ and
WESLEY S. WALTON.
TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE STRIKE A LINE
THROUGH THE NOMINEE'S NAME ABOVE.
(2) In their discretion, the Proxies are authorized to vote upon such other
matters as may properly come before the meeting.
THE SHARES REPRESENTED BY THIS PROXY WILL BE VOTED, OR THE VOTE WILL BE
WITHHELD, IN ACCORDANCE WITH ANY SPECIFICATION MADE HEREIN. IF NOT OTHERWISE
SPECIFIED, THIS PROXY WILL BE VOTED "FOR" THE ELECTION OF THE ABOVE DIRECTORS.
PLEASE SIGN ON OTHER SIDE
(CONTINUED FROM OTHER SIDE)
Receipt of the Annual Report of the Company and of the Notice of Annual Meeting
of Stockholders and the Proxy Statement dated March 21, 1996 is hereby
acknowledged.
The powers hereby granted may be exercised by a majority of said proxies or
their substitute or substitutes present and acting at said Annual Meeting or any
adjournment thereof or, if only one be present and acting, then by that one. The
undersigned hereby revokes any and all proxies heretofore given by the
undersigned to vote at said meeting.
PROXY SOLICITED ON BEHALF
OF THE BOARD OF DIRECTORS.
PLEASE SIGN HERE:
------------------------------------(SEAL)
------------------------------------(SEAL)
Dated and Signed ___________________, 1996
The signature to this proxy should conform
to the name as shown. Stock registered
jointly must be signed by all parties in
whose name such stock is registered. When
signing as attorney, executor,
administrator, trustee or guardian, give
your title as such. If signer is a
corporation, please sign full corporate name
by authorized officer.
